EXHIBIT 10.23
BUSINESS LOAN AGREEMENT
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This Agreement dated as of March 10, 1997, is among Bank of America
National Trust and Savings Association (the "Bank"), and Image Entertainment,
Inc., a California corporation (the "Borrower").
1. DEFINITIONS
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1.1 Definitions. The following terms where used in this Agreement shall
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have the meanings set forth below. Other capitalized terms used in this
Agreement not defined below shall have the meanings set forth in the body of
this Agreement.
"Addendum" means the Addendum to this Agreement which sets forth
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the terms and conditions for advances hereunder from the date hereof
until the Construction Advance Expiration Date.
"Architect" means any other architect selected by the Borrower in
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connection with the design of the Improvements and deemed acceptable
by the Bank in the reasonable exercise of its discretion.
"Architect Contract" means that certain "Standard Form of
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Agreement between Owner and Architect" dated July 22, 1996, between
the Architect and the Borrower relating to the design and construction
of the Improvements and the preparation of the Construction Plans,
including any amendments, supplements or modifications thereto.
"Banking Day" shall have the meaning set forth in Section 6.4.
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"Borrowing Date" means any date on which an advance is made under
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Section 6.
"Capital Lease" has the meaning specified in the definition of
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Capital Lease Obligations.
"Capital Lease Obligations" means the portion of all monetary
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obligations of the Borrower under any leasing or similar arrangement
which, in accordance with GAAP, is required to be shown on the balance
sheet of the Borrower in respect of any lease or similar arrangement
classified as a capital lease ("Capital Lease").
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"Cash" means all monetary and non-monetary items owned by any
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person that are treated as cash in accordance with GAAP.
"Cash Interest Expense" means Interest Expense that is paid or
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currently payable in Cash.
"Collateral" means the Real Property and Improvements and all
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personal property and proceeds thereof now owned or hereafter acquired
by the Borrower in or upon which a lien now or hereafter exists in
favor of the Bank, whether under this Agreement or under any
Collateral Document.
"Collateral Documents" means, collectively, (i) the Deed of
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Trust, all other security agreements, lease assignments and other
similar agreements between the Borrower and the Bank now or hereafter
delivered to the Bank as security for all or a part of the
Obligations, and all financing statements (or comparable documents now
or hereafter filed
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in accordance with the UCC or comparable law) against the Borrower as
debtor in favor of the Bank and (ii) any amendments, supplements,
modifications, renewals, replacements, consolidations, substitutions
and extensions of any of the foregoing.
"Completion of Construction" means the completion of the
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Improvements in a workmanlike manner in material conformity to the
Construction Plans and the Cost Breakdown, as evidenced by: (a) the
issuance of a temporary certificate of occupancy for the Improvements
by the City of Las Vegas and Xxxxx County; (b) the due recording of a
notice of completion in accordance with applicable Laws; (c) the
payment, or the satisfactory provision for payment, of all
materialmen's claims, mechanics' liens or other liens or claims for
liens directly related to the Improvements (other than those created
pursuant to the Loan Documents); (d) the delivery of certificates by
the Architect, the Contractor and by an officer of the Borrower, to
the Bank certifying that the Improvements have been substantially
completed in accordance with the Construction Plans and in substantial
compliance with all applicable Laws; (e) the Improvements being in a
physical condition (including installation of fixtures, furnishings
and equipment) to permit the Borrower to engage in its operations in
the ordinary course of business at the Improvements; and (f) the
granting to the Borrower of all necessary licenses, permits and
consents to operate the Improvements. For the purposes of the
preceding sentence, satisfactory provision for payment of
materialmen's claims, mechanics' liens or other liens or claims for
liens shall be deemed to have been made if the Borrower provides a
bond, cash deposit or other security which the Bank in the exercise of
its reasonable judgment determines to be satisfactory.
"Completion Date" means the date as of which Completion of
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Construction occurs.
"Construction Advance Expiration Date" means January 31, 1998.
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"Construction Availability Period" has the meaning specified in
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Section 2.2(a).
"Construction Contract" means, collectively, that certain
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"Standard Form of Agreement Between Owner and Contractor" dated
November 25, 1996, between Contractor and the Borrower, relating to
the construction of the Improvements.
"Construction Draw Request" has the meaning specified in Section
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3.1 of the Addendum.
"Construction Plans" means all drawings, plans and specifications
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prepared by or for the Borrower, as the same may be amended or
supplemented from time to time, and, if required, submitted to and
approved by Bank, for the construction of the Improvements and the
labor and materials necessary for the construction thereof.
"Contractor" means Xxxxxx Construction or any other licensed
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general contractor selected by the Borrower in connection with the
construction of the Improvements and deemed acceptable by the Bank in
the reasonable exercise of its discretion.
"Cost Breakdown" means a detailed breakdown of construction,
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financing and other costs relating to the construction of the
Improvements, as approved by the Bank, as amended from time to time in
accordance with the Addendum, a copy of which has been attached to the
Addendum as Schedule 1 thereto.
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"Debt Service Coverage Ratio" means, as of the last day of each
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fiscal quarter (including the last day of a fiscal quarter which is
also the last day of a fiscal year), the ratio of (a) EBITDA
(calculated for the immediately preceding four fiscal quarters)
divided by (b) the sum of (i) Cash Interest Expense calculated for the
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immediately preceding four fiscal quarters plus (ii) the current
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portion of Funded Debt (including the scheduled Commitment reductions
required by Section 2), for the four fiscal quarters immediately
following the end of such fiscal quarter, plus (iii) any other
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required principal payment of long-term debt or capital leases for the
four (4) fiscal quarters immediately following the end of such fiscal
quarter.
"Deed of Trust" has the meaning specified in Section 5.1.
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"EBITDA" means, for any period, for the Borrower, the sum of (a)
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Net Income for that period plus (b) any extraordinary loss reflected
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in such Net Income, minus (c) any extraordinary gain reflected in such
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Net Income, plus (d) cash Interest Expense for such period, plus (e)
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depreciation, amortization and all other non-cash expenses for that
period, in each case as determined in accordance with GAAP and, in the
case of items (d) and (e) only to the extent deducted in the
determination of Net Income for that period.
"Event of Default" means any event described in Sections 11.1
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through 11.1b of the Agreement.
"Funded Debt" means as of the last day of any fiscal quarter
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(including the last day of a fiscal quarter which is also the last day
of a fiscal year), without duplication, the average outstanding for
the final day of each month of the applicable fiscal quarter of (a)
the principal amount of all indebtedness of the Borrower for borrowed
money, plus (b) the aggregate amount of all Capital Lease Obligations
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of the Borrower, all as determined in accordance with GAAP.
"GAAP" means, as of any date of determination, accounting
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principles (a) set forth as generally accepted in then currently
effective Opinions of the Accounting Principles Board of the American
Institute of Certified Public Accountants, (b) set forth as generally
accepted in then currently effective Statements of the Financial
Accounting Standards Board or (c) that are then approved by such other
entity as may be approved by a significant segment of the accounting
profession in the United States. The term "consistently applied," as
used in connection therewith, means that the accounting principles
applied are consistent in all material respects with those applied at
prior dates or for prior periods.
"Governmental Authority" means any nation or government, any
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state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Improvements" mean the improvements and facilities to be
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constructed on the Real Property, including, but not limited to, a
76,000 square foot automated distribution facility and related
furnishings, fixtures, fittings and equipment.
"Indemnity" has the meaning specified in Section 10.
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"Interest Expense" means, for any period, the sum of (a) gross
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interest expense for the period (including all commissions, discounts,
fees and other similar charges in connection with standby letters of
credit and similar instruments for the Borrower), plus (b) the
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portions of rent payable with respect to that fiscal period under
Capital Leases that should be treated as interest in accordance with
GAAP less (c) interest income for that period as determined in
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accordance with GAAP.
"Loan Documents" means this Agreement, the Collateral Documents,
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the Indemnity, the Notices of Borrowing, and all certificates,
agreements or documents of any type or nature hereafter delivered to
the Bank in connection therewith, in each case as originally executed
or as the same may from time to time be supplemented, modified,
amended, restated, extended or supplanted.
"Material Adverse Effect" means (a) a material adverse change in,
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or a material adverse effect upon, the operations, business,
properties, condition (financial or otherwise) or prospects of the
Borrower; (b) a material impairment of the ability of the Borrower to
perform its respective obligations under any Loan Document; or (c) a
material adverse effect upon (i) the legality, validity, binding
effect or enforceability of any Loan Document, or (ii) the perfection
or priority of any lien granted to the Bank under any of the
Collateral Documents.
"Net Income" means, with respect to any fiscal period, the
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consolidated net income of the Borrower for that period, determined in
accordance with GAAP, consistently applied; provided, however, with
respect to the third fiscal quarter of 1996, the total of $805,000.00
in non-recurring expenses related to acquisitions and early retirement
of debt will not be included in the determination of Net Income.
"Notice of Borrowing" means a written request for an advance
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under this Agreement following the Construction Availability Period,
but prior to the Maturity Date substantially in the form of Exhibit B,
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signed by a Responsible Officer of Borrower.
"Obligations" means all advances, loans, debts, liabilities,
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obligations, covenants and duties owing by the Borrower to the Bank,
of any kind or nature, present or future, arising under this
Agreement, under any other Loan Document, whether or not evidenced by
any note, guaranty or other instrument, whether or not for the payment
of money, whether arising by reason of an extension of credit, loan,
guaranty, indemnification or in any other manner, whether direct or
indirect (including those acquired by assignment), absolute or
contingent, due or to become due, now existing or hereafter arising
and however acquired.
"Operating Lease" means any lease of real or personal property by
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Borrower which is not a Capital Lease.
"Ordinary Course of Business" means, in respect of any
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transaction involving the Borrower, the ordinary course of the
Borrower's business, as conducted by Borrower in accordance with past
practice and undertaken by Borrower in good faith and not for purposes
of evading any covenant or restriction in any Loan Document.
"Quarterly Payment Date" means December 31, 1997, and each March
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31, June 30, September 30 and December 31 thereafter.
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"Real Property" means the real property described in Exhibit A,
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including the Improvements, together with all easements and other
rights now or hereafter made appurtenant thereto, all improvements and
fixtures now or hereafter located thereon, and all additions and
accretions thereto.
"Requirement of Law" means, (i) as to Borrower, Borrower's
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organizational documents and any law or judgment, award, decree, writ
or determination of an arbitrator or of a Governmental Authority, in
each case applicable to or binding upon the Borrower or any of its
Properties or to which the Borrower or any of its Properties are
subject; and (ii) as to the Real Property, all laws, restrictions and
requirements of, and all agreements with and commitments to, all
governmental, judicial or legal authorities having jurisdiction over
the Real Property, including those pertaining to the construction,
operation or financing of the Improvements, and all recorded covenants
and restrictions affecting the Real Property.
"Responsible Officer" means the chief executive officer or the
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president or any other officer having substantially the same authority
and responsibility of the Borrower; or, with respect to delivery of
Construction Draw Requests, any of the foregoing officers of Borrower
or other officers of the Borrower designated in a writing signed by
the chief executive officer of the Borrower and delivered to the Bank.
"Revolving Availability Period" has the meaning set forth in
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Section 2.2(b).
"Total Liabilities" means the sum of current liabilities plus
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long-term liabilities.
"Tangible Net Worth" means the gross book value of the Borrower's
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assets (excluding goodwill, patents, trademarks, tradenames,
organizational expense, treasury stock, unamortized debt discount and
expense, deferred research and development costs, deferred marketing
expenses and other like intangibles and monies due from affiliates,
officers, directors, or shareholders of the Borrower) less Total
Liabilities, including, but not limited to, accrued and deferred
income taxes, and any reserve assets.
1.2 Other Interpretive Provisions.
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(a) Unless otherwise specified herein or therein, all terms defined
in this Agreement shall have the defined meanings when used in any certificate
or other document made or delivered pursuant hereto. The meaning of defined
terms are equally applicable to the singular and plural forms of the defined
terms.
(b) The words "hereof," "herein," "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, section, schedule and exhibit references are to this
Agreement unless otherwise specified.
(c) (1) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(2) The term "including" is not limiting and means
"including without limitation."
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(3) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding,"
and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications thereto,
but only to the extent such amendments and other modifications are not
prohibited by the terms of any Loan Document; and (ii) references to any statute
or regulation are to be construed as including all statutory and regulatory
provisions consolidating, amending, replacing, supplementing or interpreting the
statute or regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result
of negotiations among and have been reviewed by counsel to the Bank, the
Borrower, and the other parties, and are the products of both parties.
Accordingly, they shall not be construed against the Bank merely because of the
Bank's involvement in their preparation.
2. LINE OF CREDIT AMOUNT AND TERMS
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2.1 Line of Credit Amount.
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(a) During the availability periods described below, the Bank will
provide a line of credit to the Borrower (the "Line of Credit"). The maximum
amount of the Line of Credit (the "Maximum Commitment Amount") from the date
hereof through the Construction Advance Expiration Date shall be Three Million
Four Hundred Thirty Three Thousand Five Hundred Dollars ($3,433,500.00). On
each Quarterly Payment Date the Maximum Commitment Amount shall be reduced by an
amount equal to Forty Two Thousand Nine Hundred Eighteen and 75/100 Dollars
($42,918.75).
(b) This is a construction line of credit which converts to a
reducing revolving line of credit on the Construction Advance Expiration Date.
During the Construction Availability Period, Borrower may request advances under
the Line of Credit up to the Maximum Commitment Amount. During the Revolving
Availability Period, the Borrower may repay principal amounts and reborrow them,
provided the Borrower agrees not to permit the outstanding principal balance of
the Line of Credit to exceed the applicable Maximum Commitment Amount.
2.2 Availability Periods.
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(a) Construction Availability Period. The construction line of credit
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is available between the date of this Agreement and the Construction Advance
Expiration Date, unless the Borrower is in default (the "Construction
Availability Period").
(b) Revolving Availability Period. The revolving line of credit is
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available between the Construction Advance Expiration Date and January 31, 2008
(the "Maturity Date"), unless the Borrower is in default (the "Revolving
Availability Period").
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2.3 Interest Rate.
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(a) During the Construction Availability Period, the interest rate is
the Bank's Reference Rate plus one and one quarter percentage point (1.25) (the
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"Reference Rate Option"). During the Revolving Availability Period, unless the
Borrower elects a LIBOR Rate Option as described in Section 3 below, the
interest rate will be the Reference Rate Option.
(b) Bank of America National Trust and Savings Association's
Reference Rate is the rate of interest publicly announced from time to time by
Bank as its Reference Rate. Bank's Reference Rate is set based on various
factors, including Bank's costs and desired return, general economic conditions,
and other factors, and is used as a reference point for pricing some loans. The
Bank may price loans to its customers at, above, or below the Reference Rate.
Any change in the Bank's Reference Rate shall take effect at the opening of
business on the day specified in the public announcement of a change in Bank's
Reference Rate.
2.4 Repayment Terms.
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(a) During the Construction Availability Period, the Borrower will
pay interest on the last day of the first calendar month in which the first
advance hereunder is made, and then monthly thereafter on the last day of each
month through the Construction Advance Expiration Date. During the Revolving
Availability Period, for those portions of the Line of Credit accruing interest
at the Reference Rate Option, the Borrower will pay interest on the last day of
each month until payment in full of any principal outstanding under the Line of
Credit. For those portions of the Line of Credit accruing interest at a LIBOR
Rate Option, the Borrower will pay interest at the end of the applicable
interest period, except in the case of interest periods exceeding three (3)
months, in which case interest will be paid at the end of each ninety (90) day
period.
(b) On each Quarterly Payment Date, the Borrower will be required to
pay quarterly principal reduction payments to the extent necessary to reduce the
outstanding principal balance of the Line of Credit to the applicable Maximum
Commitment Amount set forth in Paragraph 2.1(a) above. On the Maturity Date,
the Borrower will repay the remaining principal and unpaid interest in full.
3. OPTIONAL INTEREST RATE
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3.1 LIBOR Rate Option. During the Revolving Availability Period, the
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Borrower may elect to have all or portions of the principal balance of the Line
of Credit bear interest at the LIBOR Rate Option plus the applicable margin.
The applicable margin shall be equal to 2.65 percentage points when the Debt
Service Coverage Ratio is equal to or less than 3.0 to 1.0, and the applicable
margin shall be equal to 2.25 percentage points when the Debt Service Coverage
Ratio exceeds 3.0 to 1.0.
Designation of any LIBOR Rate portion is subject to the following requirements:
(a) The interest period during which the LIBOR Rate Option will be in
effect will be three (3), six (6), nine (9) or twelve (12) months. The last day
of the interest period will be determined by the Bank using the practices of the
London inter-bank market.
(b) Each LIB0R Rate portion will be for an amount not less than Five
Hundred Thousand Dollars ($500,000) and in multiples of One Hundred Thousand
Dollars ($100,000).
(c) The Borrower shall irrevocably request a LIBOR Rate portion no
later than 9:00 a.m. pacific coast time three (3) Banking Days before the
commencement of the interest period.
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(d) The "LIBOR Rate" means the interest rate determined by the
following formula, rounded upward to the nearest 1/100th of one percent. (All
amounts in the calculation will be determined by the Bank as of the first day of
the interest period.)
LIBOR Rate = London Rate
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(1.00 - Reserve Percentage)
Where,
(i) "London Rate" means the interest rate (rounded upward
to the nearest 1/100th of one percent) at which the BofA California's
London Branch would offer U.S. Dollar deposits for the applicable interest
period to other major banks in the London inter-bank market at
approximately 11:00 a.m. London time two (2) banking days before the
commencement of the interest period.
(ii) "Reserve Percentage" means the total of the maximum
reserve percentages for determining the reserves to be maintained by member
banks of the Federal Reserve System for Eurocurrency Liabilities, as
defined in Federal Reserve Board Regulation D, rounded upward to the
nearest 1/100th of one percent. The percentage will be expressed as a
decimal, and will include, but not be limited to, marginal, emergency,
supplemental, special, and other reserve percentages.
(e) The Borrower may not elect a LIBOR Rate Option with respect to
any principal amount which is scheduled to be repaid before the last day of the
applicable interest period.
(f) Any portion of the principal balance already bearing interest at
the LIBOR Rate Option will not be converted to a different rate during its
interest period.
(g) Each prepayment of a LIBOR Rate portion whether voluntary, by
reason of acceleration or otherwise, will be accompanied by the amount of
accrued interest on the amount prepaid and a prepayment fee as described below.
A "prepayment" is a payment of an amount on a date earlier than the scheduled
payment date for such amount as required by this Agreement. The prepayment fee
shall be equal to the amount (if any) by which:
(i) the additional interest which would have been payable during
the interest period on the amount prepaid had it not been prepaid, exceeds
(ii) the interest which would have been recoverable by the Bank
by placing the amount prepaid on deposit in the London inter-bank market
for a period starting on the date on which it was prepaid and ending on the
last day of the interest period for such portion (or the scheduled payment
date for the amount prepaid, if earlier).
(h) The Bank will have no obligation to accept an election for a
LIBOR Rate portion if any of the following described events has occurred and is
continuing:
(i) Dollar deposits in the principal amount, and for periods
equal to the interest period, of a LIBOR Rate portion are not available in
the London inter-bank market; or
(ii) the LIBOR Rate Option does not accurately reflect the cost
of a LIBOR Rate portion.
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(i) Borrower may not elect to have more than five (5) LIBOR Rate
portions outstanding at any one time.
(j) Any LIBOR Rate portion shall automatically convert to bearing
interest at the Reference Rate Option at the end of the applicable interest
period unless Borrower makes another election of a LIBOR Rate Option in
accordance with this Section 3.
4. FEES AND EXPENSES
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4.1 Upfront Fee. The Borrower agrees to pay an upfront origination fee of
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Thirty Four Thousand Three Hundred Thirty-Five and 00/100 Dollars ($34,335.00)
upon the execution hereof ("Upfront Fee").
4.2 Conversion Fee. Upon the expiration of the Construction Availability
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Period, the Borrower agrees to pay to Bank a conversion fee of Seventeen
Thousand One Hundred Sixty Seven and 50/100 Dollars ($17,167.50) (the
"Conversion Fee").
4.3 Commitment Fee. From and after the Construction Advance Expiration
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Date, the Borrower shall pay to the Bank a commitment fee on the average daily
unused portion of the Maximum Commitment Amount, computed on a quarterly basis
in arrears each Quarterly Payment Date, based upon the daily utilization for
that quarter as calculated by the Bank, calculated at either (i) one half of one
percent (.50%) when the Debt Service Coverage Ratio is equal to or less than 3.0
to 1.0; and (ii) three eighths of one percent (.375%) when the Debt Service
Coverage Ratio exceeds 3.0 to 1.0.
4.4 Expenses.
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(a) The Borrower agrees to immediately repay the Bank for expenses
that include, but are not limited to, filing, recording and search fees,
appraisal fees, title report fees, survey fees, and documentation fees.
(b) The Borrower agrees to reimburse the Bank for any expenses it
incurs in the preparation of this Agreement and any agreement or instrument
required by this Agreement. Expenses include, but are not limited to,
reasonable attorneys' fees, including any allocated costs of the Bank's in-house
counsel.
(c) During the Construction Availability Period the Borrower agrees
to reimburse the Bank for the cost of the inspections conducted by the Bank, or
Bank's agent.
5. COLLATERAL
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5.1 Real Property. The Borrower's obligations to the Bank under this
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Agreement will be secured by the Real Property, together with the Improvements,
and all rents, leases, revenues, issues and profits arising from the Real
Property and Improvements. To evidence this security, Borrower will execute a
deed of trust in favor of the Bank as beneficiary (the "Deed of Trust"), which
Deed of Trust will be recorded in the official records of Xxxxx County, Nevada.
5.2 Personal Property. The Borrower's obligations to the Bank under this
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Agreement will be secured by a security interest in and lien on all of the
furniture, fixtures, equipment, accounts and revenues located on, relating to or
to be used in connection with the Real Property and Improvements (other than
equipment leased by Borrower and Borrower's inventory and receivables), which
security interest and lien is to be evidenced by the Deed of Trust.
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5.3 Partial Release. The Real Property currently consists of
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approximately sixteen (16) acres. The Borrower intends to subdivide the Real
Property into two (2) separate legal parcels consisting of approximately eight
(8) acres each. Upon completion of the subdivision process for the Real
Property in accordance with applicable Nevada law, and subject to the additional
conditions precedent set forth below, Bank will cause to be recorded in the
official records of Xxxxx County, Nevada, a partial release and reconveyance
("Partial Release") relating to that parcel of the Real Property upon which the
Improvements will not be located. The following are conditions precedent to the
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recording of the Partial Release:
(a) Bank shall have received and approved a copy of the final parcel
map for the Real Property approved by Xxxxx County;
(b) Bank shall have received a commitment from United Title of Nevada
to issue an endorsement, or endorsements, to Bank's policy of title insurance,
insuring the validity and priority of the Bank's Deed of Trust upon the
recording of the Partial Release; and
(c) Borrower shall have paid to Bank all fees and costs, including
title insurance costs, incurred by Bank in connection with the recording of the
Partial Release.
6. DISBURSEMENTS, PAYMENTS AND COSTS
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6.1 Requests for Advances. Each request for an advance under this
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Agreement will be made in writing in a manner acceptable to the Bank, or by
another means acceptable to the Bank. With respect to any disbursement requests
during the Construction Availability Period ("Construction Draw Requests"), the
terms and conditions of the Addendum attached hereto and incorporated herein by
this reference shall control. With respect to any disbursement requests during
the Revolving Availability Period, but prior to the Maturity Date, Borrower
shall provide Bank with a Notice of Borrowing.
6.2 Disbursements and Payments. Each disbursement by the Bank and each
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payment by the Borrower will be:
(a) made at the Bank's branch (or other location) selected by the
Bank from time to time;
(b) made for the account of the Bank's branch selected by the Bank
from time to time;
(c) made in immediately available funds, or such other type of funds
selected by the Bank;
(d) evidenced by records kept by the Bank. In addition, the Bank may,
at its discretion, require the Borrower to sign one or more promissory notes.
6.3 Telephone Authorization.
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(a) The Bank may honor telephone instructions for repayments given by
any one of the individual signer(s) of this Agreement or a person or persons
authorized by any one of the signer(s) of this Agreement in writing.
(b) Repayments will be withdrawn from the Borrower's accounts with
the Bank as designated in writing by the Borrower.
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(c) The Borrower indemnifies and excuses the Bank (including its
officers, employees, and agents) from all liability, loss, and costs in
connection with any act resulting from telephone instructions it reasonably
believes are made by a signer of this Agreement or a person authorized by a
signer. This indemnity and excuse will survive this Agreement's termination.
6.4 Banking Days. Unless otherwise provided in this Agreement, a banking
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day is a day other than a Saturday or a Sunday on which the Bank is open for
business in Nevada ("Banking Day"). All payments and disbursements which would
be due on a day which is not a Banking Day will be due on the next Banking Day.
All payments received on a day which is not a Banking Day will be applied to the
credit on the next Banking Day.
6.5 Taxes. The Borrower will not deduct any taxes from any payments it
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makes to the Bank. If any Governmental Authority imposes any taxes or charges
on any payments made by the Borrower, the Borrower will pay the taxes or
charges. Upon request by the Bank, the Borrower will confirm that it has paid
the taxes by providing the Bank official tax receipts (or notarized copies)
within thirty (30) days after the due date. However, the Borrower will not pay
the Bank's net income taxes.
6.6 Interest Calculation. Except as otherwise stated in this Agreement,
--------------------
all interest and fees, if any, will be computed on the basis of a three hundred
sixty (360) day year and the actual number of days elapsed. This results in
more interest or a higher fee than if a three hundred sixty-five (365) day year
is used.
6.7 Interest on Late Payments. In the event any payment required
-------------------------
hereunder is received by the Bank fifteen (15) days after its due date, a late
charge of five percent (5.00%) of each overdue payment may be charged for the
purpose of defraying the expenses incident to handling said delinquent payments
and as an inducement to the Borrower to make timely payment. Acceptance of a
scheduled payment fifteen (15) days after its due date shall not waive any
appropriate late charge, nor shall it constitute a waiver of any Event of
Default.
6.8 Default Rate. Upon the occurrence and during the continuation of any
------------
Default under this Agreement, advances hereunder will, at the option of the
Bank, bear interest at a rate per annum which is three percentage points (3.00%)
higher than the rate of interest otherwise provided under this Agreement (the
"Default Rate"). Failure by the Bank to assess the Default Rate where
appropriate will not constitute a waiver of any Event of Default.
7. CONDITIONS
----------
In addition to those conditions precedent for construction advances as set
forth in the Addendum, the Bank must receive the following items, in form and
content acceptable to the Bank, before it is required to extend any credit to
the Borrower under this Agreement.
7.1 Authorizations. Evidence that the execution, delivery and performance
--------------
by the Borrower of this Agreement and any instrument or agreement required under
this Agreement have been duly authorized.
7.2 Governing Documents. A copy of Borrower's articles of incorporation
-------------------
and bylaws.
7.3 Legal Opinions. Upon Bank's request, the Borrower shall provide the
--------------
Bank with an opinion of the Borrower's counsel, satisfactory to the Bank, that:
(1) the Borrower is authorized to enter into the transactions evidenced by this
Agreement and Collateral Documents; and (2) the subject transactions do not
require the approval of any Governmental Authority, except as otherwise
specified. The legal opinion shall
11
also cover such additional matters as the Bank may require. The legal counsel
and the terms of the opinion must be acceptable to the Bank.
7.4 Resolution. With this Agreement, a resolution, passed by the
----------
Borrower's board of directors, authorizing the Borrower to enter into this
Agreement and any instrument or agreement required under this Agreement. Such
resolution shall also authorize specific individuals to execute this Agreement
and any instrument or agreement required under this Agreement.
7.5 Collateral Agreements. Signed Collateral Documents, as well as
---------------------
financing statements and fixture filings (together with collateral in which the
Bank requires a possessory security interest), which the Bank requires.
7.6 Evidence of Priority. Evidence that security interests and liens in
--------------------
favor of the Bank are valid, enforceable, and prior to all others' rights and
interests, except those the Bank consents to in writing.
7.7 Title Insurance. An ALTA lender's title insurance policy and from a
---------------
title company acceptable to Bank, for at least $3,433,500.00, insuring the lien
of the Bank's Deed of Trust as a first and prior lien on the Real Property and
Improvements subject only to those matters approved in writing by Bank.
7.8 Insurance. Evidence of insurance coverage, as required in the
---------
"Covenants" section of this Agreement, and as required by the Addendum.
7.9 Other Items. Any other items that the Bank reasonably requires,
-----------
including, but not limited to the following:
(a) Copy of ALTA/ASCM survey of the Real Property acceptable to the
Bank.
(b) Executed copy of an Assignment of Construction Agreements and
Consent of Contractor.
(c) Executed copy of an Assignment of Agreements, Plans and
Specifications and Consent of Architect.
8. REPRESENTATIONS AND WARRANTIES
------------------------------
When the Borrower signs this Agreement, and until the Bank is repaid in
full, the Borrower makes the following representations and warranties. Each
request for an extension of credit constitutes a renewed representation:
8.1 Organization of the Borrower. The Borrower is a corporation duly
----------------------------
formed and existing under the laws of the State of California.
8.2 Authorization. This Agreement, and any instrument or agreement
-------------
required hereunder, are within the Borrower's powers, have been duly authorized,
and do not conflict with any of its organizational papers.
8.3 Enforceable Agreement. This Agreement is a legal, valid and binding
---------------------
agreement of the Borrower, enforceable against the Borrower in accordance with
its terms, and any instrument or agreement required hereunder, when executed and
delivered, will be similarly legal, valid, binding, and enforceable.
12
8.4 Good Standing. In each jurisdiction in which the Borrower does
-------------
business, it is properly licensed, in good standing, and, where required, in
compliance with fictitious name statutes.
8.5 No Conflicts. This Agreement does not conflict with any law,
------------
agreement, or obligation by which the Borrower is bound.
8.6 Financial Information. All financial and other information that has
---------------------
been or will be supplied to the Bank, including, but not limited to, the
Borrower's 1996 audited financial statements dated as of March 31, 1996, are:
(a) sufficiently complete to give the Bank accurate knowledge of the
Borrower's financial condition.
(b) in form and content required by the Bank.
(c) in compliance with all government regulations that apply.
Since the date of the financial statement(s) specified above, there has been no
Material Adverse Effect with respect to the assets or the financial condition of
the Borrower.
8.7 Lawsuits. There is no lawsuit, tax claim or other dispute pending or
--------
threatened against the Borrower which, if lost, would impair the Borrower's
financial condition or ability to repay the loan, except as have been disclosed
in writing to the Bank.
8.8 Collateral. All Collateral required in this Agreement is owned by the
----------
grantor of the security interest free of any title defects or any liens or
interests of others.
8.9 Permits, Franchises. The Borrower possesses all permits, memberships,
-------------------
franchises, contracts and licenses required and all trademark rights, trade name
rights, patent rights and fictitious name rights necessary to enable it to
conduct the business in which it is now engaged without conflict of the rights
of others.
8.10 Other Obligations. The Borrower is not in default on any obligation
-----------------
for borrowed money; any purchase money obligation; or any other material lease,
commitment, contract, instrument, or obligation.
8.11 No Event of Default. There is no event which is, or with notice or
-------------------
lapse of time or both would be, an event of Default under this Agreement.
8.12 ERISA Plans.
-----------
(a) The Borrower has fulfilled its obligations, if any, under the
minimum funding standards of ERISA and the Code with respect to each Plan and is
in compliance in all material respects with the presently applicable provisions
of ERISA and the Code, and has not incurred any liability with respect to any
Plan under Title IV of ERISA.
(b) No reportable event has occurred under Section 4043(b) of ERISA
for which the PBGC requires 30 days notice.
(c) No action by the Borrower to terminate or withdraw from any Plan
has been taken and no notice of intent to terminate a Plan has been filed under
Section 4041 of ERISA.
13
(d) No proceeding has been commenced with respect to a Plan under
Section 4042 of ERISA, and no event has occurred or condition exists which might
constitute grounds for the commencement of such a proceeding.
(e) The following terms have the meanings indicated for purposes of
this Agreement:
(i) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(ii) "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
(iii) "PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.
(iv) "Plan" means any employee pension benefit plan maintained
or contributed to by the Borrower and insured by the Pension Benefit
Guaranty Corporation under Title IV of ERISA.
8.13 Location of Borrower. The Borrower's place of business (or, if the
--------------------
Borrower has more than one place of business, its chief executive office) is
located at the address listed under the Borrower's signature on this Agreement.
9. COVENANTS
---------
In addition to the special covenants relating to the construction of the
Improvements set forth in the Addendum, the Borrower agrees, so long as credit
is available under this Agreement and until the Bank is repaid in full:
9.1 Use of Proceeds. During the Construction Availability Period, to use
---------------
the proceeds of the line of credit for the development and construction of the
Improvements. From and after the Construction Advance Expiration Date, to use
the proceeds of the Line of Credit for general working capital.
9.2 Financial Information. To provide the following financial information
---------------------
and statements and such additional information as requested by the Bank (in a
form and content acceptable to the Bank) from time to time:
(a) Within ninety (90) days of the Borrower's fiscal year end, the
Borrower's annual financial statements. These financial statements must be
audited with an unqualified opinion by a Certified Public Accountant ("CPA")
acceptable to the Bank.
(b) Within ninety (90) days of the end of each of Borrower's fiscal
year ends, Borrower's capital expenditure budget and annual operating budget
projections.
(c) Within forty five (45) days of the period's end, excluding the
fiscal year end period, the Borrower's quarterly financial statements. These
financial statements may be Borrower prepared.
(d) Copies of any annual reports, proxy statements, financial
statements, reports or communications sent to shareholders, and copies of any
annual, regular, periodic or special reports or registration statements filed
with the SEC within fifteen (15) days after the same become available.
14
9.3 Debt Service Coverage Ratio. To maintain a minimum Debt Service
---------------------------
Coverage Ratio of not less than 2.0 to 1.0.
9.4 Maximum Total Liabilities to Tangible Net Worth. To maintain a ratio
-----------------------------------------------
of Total Liabilities to Tangible Net Worth of not more than 2.0 to 1.0.
9.5 Maximum-Loan-to-Value Ratio. At all times during the term of this
---------------------------
Agreement, the ratio of the applicable Maximum Commitment Amount of the Line of
Credit to the discounted value of the Real Property and Improvements at
stabilized occupancy ("Discounted Stabilized Value") shall at no time exceed
seventy percent (70%)(the "Maximum Loan-to-Value Ratio"). For purposes of this
Section 9.5, Bank shall determine the Discounted Stabilized Value of the Real
Property and Improvements using a methodology which (i) conforms to then-current
regulatory requirements, (ii) is considered by Bank to be appropriate under the
circumstances, and (iii) takes into account then-current market conditions,
including vacancy factors, estimated date of stabilization, discount rates, and
rental rates and concessions, all as determined by Bank.
9.6 Other Liens. Not to create, assume, or allow any security interest or
-----------
lien (including judicial liens) on the Real Property and Improvements, except:
(a) Deeds of trust and security agreements in favor of the Bank.
(b) Liens for taxes not yet due.
9.7 Notices to the Bank. To promptly notify the Bank in writing of:
-------------------
(a) any lawsuit over One Million Dollars ($1,000,000) against the
Borrower.
(b) any substantial dispute between the Borrower and any Governmental
Authority.
(c) any failure to comply with this Agreement.
(d) any Material Adverse Effect with respect to the Borrower's
financial condition or operations.
(e) any change in the Borrower's name, legal structure, place of
business, or chief executive office if the Borrower has more than one place of
business.
9.8 Books and Records. To maintain adequate books and records.
-----------------
9.9 Audits and Site Visits.
----------------------
(a) Upon written notice to Borrower, to allow the Bank and its agents
to inspect the Borrower's properties and examine, audit, and make copies of
books and records at any reasonable time. If any of the Borrower's properties,
books or records are in the possession of a third party, the Borrower authorizes
that third party to permit the Bank or its agents to have access to perform
inspections or audits and to respond to the Bank's requests for information
concerning such properties, books and records.
(b) In addition to those rights granted to the Bank under the
Addendum during the Construction Availability Period, to allow the Bank and its
agents and representatives to enter and visit the Real Property upon advance
notice during normal business hours for the purposes of:
15
(i) performing an appraisal;
(ii) inspecting the Real Property and Improvements;
(iii) taking soil or groundwater samples; and
(iv) conducting tests, among other things, to investigate for
the presence of hazardous substances, as defined in Section 10 hereof.
In each instance, the Bank shall give the Borrower notice before entering
the Real Property and Improvements. The Bank shall make an effort to avoid
interfering with the Borrower's use of the Real Property and Improvements when
exercising any of the rights granted in this paragraph 9.9(b). The Bank is under
no duty to visit or observe the Real Property and Improvements, or to examine
any books or records. Any site visit, observation or examination by the Bank
shall be solely for the purpose of protecting the Bank's security and preserving
the Bank's rights under this Agreement and the Security Documents. The Bank
owes no duty of care to protect the Borrower or any other party against, or to
inform the Borrower or any other party of, any adverse condition affecting the
Real Property and Improvements, including any defects in the design or
construction of any improvements on the Real Property and Improvements or the
presence of any hazardous substances on the Real Property and Improvements.
9.10 Compliance with Laws. To comply with the laws (including any
--------------------
fictitious name statute), regulations, and orders of any Governmental Authority.
9.11 Preservation of Rights. To maintain and preserve all rights,
----------------------
privileges, and franchises the Borrower now has.
9.12 Maintenance of Properties. To make any repairs, renewals, or
-------------------------
replacements to keep the Borrower's properties in good working condition.
9.13 Perfection of Liens. To help the Bank perfect and protect its
-------------------
security interests and liens, and reimburse it for related costs it incurs to
protect its security interests and liens.
9.14 Cooperation. To take any action requested by the Bank to carry out
-----------
the intent of this Agreement.
9.15 Insurance. In addition to those requirements set forth in the
---------
Addendum:
(a) Insurance Covering Collateral. To maintain all risk property
-----------------------------
damage insurance policies covering the tangible property comprising the
Collateral. Each insurance policy must be in an amount acceptable to the Bank.
The insurance must be issued by an insurance company acceptable to the Bank and
must include a lender's loss payable endorsement in favor of the Bank in a form
acceptable to the Bank.
(b) General Business Insurance. To maintain insurance satisfactory to
--------------------------
the Bank as to amount, nature, and carrier covering property damage (including
loss of use and occupancy) to any of the Borrower's properties, public liability
insurance including coverage for contractual liability, product liability and
workers' compensation, and any other insurance which is usual for the Borrower's
business.
(c) Evidence of Insurance. Upon the request of the Bank, deliver to
---------------------
the Bank a copy of each insurance policy, or, if permitted by the Bank, a
certificate of insurance listing all insurance in force.
16
9.16 Dividends/Stock Reimbursement. Not to declare any dividends on
-----------------------------
outstanding shares of Borrower's capital stock. Not to enter into any purchase,
redemption or acquisition of the Borrower's capital stock, or create any sinking
fund in relation thereto, in excess of the two million five hundred thousand
(2,500,000) shares previously authorized by Borrower's board of directors as of
January 7, 1997.
9.17 Additional Negative Covenants. Not to, without the Bank's written
-----------------------------
consent:
(a) engage in any business activities substantially different from
the Borrower's present business of distributing home entertainment software.
(b) liquidate or dissolve the Borrower's business.
(c) enter into any consolidation, merger, pool, joint venture,
syndicate, or other combination.
(d) lease, or dispose of all or a substantial part of the Borrower's
business or the Borrower's assets.
(e) acquire or purchase a business or its assets outside of the home
entertainment software industry.
9.18 ERISA Plans. To give prompt written notice to the Bank of:
-----------
(a) The occurrence of any reportable event under Section 4043(b) of
ERISA for which the PBGC requires 30 day notice.
(b) Any action by the Borrower to terminate or withdraw from a Plan
or the filing of any notice of intent to terminate under Section 4041 of ERISA.
(c) Any notice of noncompliance made with respect to a Plan under
Section 4041(b) of ERISA.
(d) The commencement of any proceeding with respect to a Plan under
Section 4042 of ERISA.
10. HAZARDOUS WASTE INDEMNIFICATION
-------------------------------
The Borrower will indemnify and hold harmless the Bank from any loss or
liability directly or indirectly arising out of the use, generation,
manufacture, production, storage, release, threatened release, discharge,
disposal, or presence of a hazardous substance. This indemnity will apply
whether the hazardous substance is on, under, or about the Borrower's property
or operations or property leased to the Borrower. The indemnity includes, but
is not limited to, attorneys' fees (including the reasonable estimate of the
allocated cost of in-house counsel and staff). The indemnity extends to the
Bank, its parent, subsidiaries, and all of their directors, officers, employees,
agents, successors, attorneys, and assigns. For these purposes, the term
"hazardous substances" means any substance which is or becomes designated as
"hazardous" or "toxic" under any federal, state, or local law. This indemnity
will survive repayment of the Borrower's obligations to the Bank. The Borrower
agrees to execute a separate secured indemnity agreement on the Bank's form to
evidence this indemnity (the "Indemnity").
17
11. DEFAULT
-------
If any of the following events of default occur, the Bank may do one or
more of the following: declare the Borrower in default, terminate this
Agreement, stop making any additional credit available to the Borrower, and
require the Borrower to repay its entire debt immediately and without further
notice; provided, however that if any bankruptcy or insolvency petition is filed
with respect to the Borrower, or the default relates to an event described in
paragraph 11. 4 or 11. 5, the entire debt outstanding under this Agreement will
automatically become due immediately.
11.1 Failure to Pay. The Borrower fails to make a payment under this
--------------
Agreement when due.
11.2 Lien Priority. The Bank fails to have an enforceable first lien
-------------
(except for any prior liens to which the Bank has consented in writing) on or
security interest in any property given as security for this loan.
11.3 False Information. The Borrower has given the Bank false or
-----------------
misleading information or representations.
11.4 Bankruptcy. The Borrower files a bankruptcy petition, a bankruptcy
----------
petition is filed against the Borrower and such involuntary petition is not
dismissed within forty-five (45) days thereafter, or the Borrower makes a
general assignment for the benefit of creditors.
11.5 Receivers. A receiver or similar official is appointed for the
---------
Borrower's business, or the business is terminated.
11.6 Lawsuits. Any lawsuit or lawsuits are filed on behalf of one or more
--------
trade creditors against the Borrower in an aggregate amount of Five Million
Dollars ($5,000,000) or more in excess of any insurance coverage.
11.7 Judgments. Any judgments or arbitration awards are entered against
---------
the Borrower, or the Borrower enters into any settlement agreements with respect
to any litigation or arbitration, in an aggregate amount of One Million Dollars
($1,000,000) or more in excess of any insurance coverage .
11.8 Government Action. Any Governmental Authority takes action that the
-----------------
Bank believes cause a Material Adverse Effect.
11.9 Material Adverse Effect. The occurrence of a Material Adverse Effect.
-----------------------
11.10 Cross-default. Any default occurs under any agreement in connection
-------------
with any credit the Borrower has obtained from anyone else or which the Borrower
has guaranteed.
11.11 Default Under Related Documents. Any default occurs under any of the
-------------------------------
other documents required by this Agreement, which default remains uncured after
any applicable cure period.
11.12 Other Bank Agreements. The Borrower fails to meet the conditions
---------------------
of, or fails to perform any obligation under any other agreement the Borrower
has with the Bank or any affiliate of the Bank.
11.13 Other Breach Under Agreement. The Borrower fails to meet the
----------------------------
conditions of, or fails to perform any obligation under, any term of this
Agreement not specifically referred to in this Article, and such failure
continues for thirty (30) days ("Initial Cure Period") after written notice from
Bank to Borrower. So long as Borrower begins within the Initial Cure Period and
diligently continues to cure the failure, and Bank,
18
in its sole judgment, determines that the cure cannot reasonably be completed at
or before expiration of the Initial Cure Period, then the Initial Cure Period
may be extended by a period not to exceed ninety (90) days.
12. ENFORCING THIS AGREEMENT; MISCELLANEOUS
---------------------------------------
12.1 GAAP. Except as otherwise stated in this Agreement, all financial
----
information provided to the Bank and all financial covenants will be made under
generally accepted accounting principles, consistently applied. References
herein to "fiscal year" and "fiscal quarter" refer to such fiscal periods of
Borrower.
12.2 Governing Law. This Agreement shall be governed, interpreted and
-------------
construed in accordance with the laws of the State of Nevada.
12.3 Successors and Assigns. This Agreement is binding on the Borrower's
----------------------
and the Bank's successors and assignees. The Borrower agrees that it may not
assign this Agreement without the Bank's prior consent. The Bank may sell
participations in or assign this loan, and may exchange financial information
about the Borrower with actual or potential participants or assignees. If a
participation is sold or the loan is assigned, the purchaser will have the right
of setoff against the Borrower.
12.4 Arbitration.
-----------
(a) This paragraph concerns the resolution of any controversies or
claims between the Borrower and the Bank, including but not limited to those
that arise from:
(i) This Agreement (including any renewals, extensions or
modifications of this Agreement);
(ii) Any document, agreement or procedure related to or
delivered in connection with this Agreement;
(iii) Any violation of this Agreement; or
(iv) Any claims for damages resulting from any business
conducted between the Borrower and the Bank, including claims for injury to
persons, property or business interests (torts).
(b) Any such controversies or claims will be settled by arbitration
in accordance with the United States Arbitration Act. The United States
Arbitration Act will apply even though this Agreement provides that it is
governed by the laws of the State of Nevada. All arbitrators shall be selected
from a list of arbitrators within the State of Nevada as provided by the
American Arbitration Association.
(c) Arbitration proceedings will be administered by the American
Arbitration Association and will be subject to its commercial rules of
arbitration; except as otherwise provided herein.
(d) For purposes of the application of the statute of limitations,
the filing of an arbitration pursuant to this paragraph is the equivalent of the
filing of a lawsuit, and any claim or controversy which may be arbitrated under
this paragraph is subject to any applicable statute of limitations. The
arbitrators will have the authority to decide whether any such claim or
controversy is barred by the statute of limitations and, if so, to dismiss the
arbitration on that basis.
(e) If there is a dispute as to whether an issue is arbitrable, the
arbitrators will have the authority to resolve any such dispute.
19
(f) The decision that results from an arbitration proceeding may be
submitted to the appropriate court of law to be confirmed and enforced.
(g) This provision does not limit the right of the Borrower or the
Bank to exercise self-help remedies such as setoff.
12.5 Severability; Waivers. If any part of this Agreement is not
---------------------
enforceable, the rest of the Agreement may be enforced. The Bank retains all
rights, even if it makes a loan after default. If the Bank waives any Event of
Default, it may enforce a later Event of Default. Any consent or waiver under
this Agreement must be in writing.
12.6 Costs. If the Bank incurs any expenses in connection with
-----
administering or enforcing this Agreement, or if the Bank takes collection
action under this Agreement, it is entitled to costs and reasonable attorneys'
fees, including any allocated costs of in-house counsel.
12.7 Attorneys' Fees. In the event of a lawsuit or arbitration proceeding,
---------------
the prevailing party is entitled to recover costs and reasonable attorneys' fees
(including any allocated costs of in-house counsel) incurred in connection with
the lawsuit or arbitration proceeding, as determined by the court or arbitrator.
12.8 One Agreement. This Agreement and any related security or other
-------------
agreements required by this Agreement, collectively:
(a) represent the sum of the understandings and agreements between
the Bank and the Borrower concerning this credit; and
(b) replace any prior oral or written agreements between the Bank
and the Borrower concerning this credit, and
(c) are intended by the Bank and the Borrower as the final,
complete, and exclusive statement of the terms agreed to by them.
In the event of any conflict between this Agreement and any other agreements
required by this Agreement, this Agreement will prevail.
12.9 Exchange of Information. The Borrower agrees that the Bank may
-----------------------
exchange financial information about the Borrower with BankAmerica Corporation
affiliates and other related entities.
12.10 Notices. All notices required under this Agreement shall be
-------
personally delivered or sent by first class mail, postage prepaid, to the
addresses on the signature page of this Agreement, or to such other addresses as
the Bank and the Borrower may specify from time to time in writing.
12.11 Headings. Article and paragraph headings are for reference only and
--------
shall not affect the interpretation or meaning of any provisions of this
Agreement.
12.12 Counterparts. This Agreement may be executed in as many
------------
counterparts as necessary or convenient, and by the different parties on
separate counterparts each of which, when so executed, shall be deemed an
original, but all such counterparts shall constitute but one and the same
agreement.
20
This Agreement is executed as of the date stated at the top of the first
page.
BANK OF AMERICA NATIONAL IMAGE ENTERTAINMENT, INC.,
TRUST AND SAVINGS ASSOCIATION a California corporation
By: /s/ XXXX XXXXXXXXXX By: /s/ XXXX X. XXXXXX
--------------------------- --------------------------------
Xxxx Xxxxxxxxxx Name: Xxxx X. Xxxxxx
Vice President Title: Chief Financial Officer
Address where notices to the Address where notices to the
Bank are to be sent: Borrower are to be sent:
Commercial Banking Division - South 0000 Xxx Xxxxxx
000 Xxxxx Xxxxxx Xxxxxx, 0xx Xxxxx Xxxxxxxxxx, Xxxxxxxxxx 00000-0000
Xxx Xxxxx, Xxxxxx 00000
21
